Finance in Asset Management: Fund and Firm Accounting

Asset management is the only part of regulated finance where the finance function routinely accounts for two entirely separate things: the funds, which belong to investors, and the management company, which belongs to the shareholders. They have different reporting entities, different cycles, different audiences and different auditors — and businesses that blur them in a job specification produce shortlists containing the wrong people. This guide sets out what sits on each side, what the Financial Controller owns across both, where the difficulty concentrates, and what the sector pays in 2026.

The two sides

The practical implication for hiring: a strong financial accountant is not a substitute for a fund accountant, and vice versa. Our fund accountant job description covers the fund-side role, and fund accounting basics the technical ground.

What the fund side involves

Net asset value production or oversight. The central deliverable. Many UK managers outsource administration and retain an oversight function — reviewing and challenging the administrator’s NAV rather than producing it. That is a genuinely different skill set: reconciliation, challenge and adviser management rather than production, and it is the distinction most often left unstated in a job advert.

Valuation. Straightforward for liquid funds and the core difficulty for private markets, where the valuation policy, the committee process and the evidence behind each holding is where auditors and investors focus.

Fee calculation. Management fees, performance fees, equalisation, and — in private markets — carried interest and the waterfall. This is judgement-heavy work and it is where fund accounting stops being mechanical.

Investor reporting. Capital statements, drawdown and distribution notices, periodic reporting, and the data feeding factsheets.

And the fund audit, which is a separate engagement from the firm audit with its own timetable and its own findings.

What the firm side involves

Everything a Financial Controller owns in any business — the close, the balance sheet, statutory accounts, the audit, the team — plus the prudential obligations that apply because the manager is authorised.

Revenue recognition on management and performance fees, which is the firm’s income and frequently the largest judgement in its accounts. Performance fees accrued before they crystallise are a recurring audit conversation.

Regulatory capital. Most UK managers are MIFIDPRU firms, with own funds, the own funds requirement and K-factors — assets under management being the K-factor that matters most here. Our guide to finance in an investment firm covers the prudential half in detail, and ICARA and the IFPR the framework.

Client money under CASS 7, where the manager holds it — many do not, holding only fund assets through a depositary, and establishing which is true is the first question in any search.

And cost allocation between the firm and the funds, which is the quietly contentious one: what may properly be charged to a fund under its documentation, and what must be borne by the manager. Getting it wrong is both an investor issue and, under fair value expectations, a regulatory one.

Where the difficulty concentrates

The boundary between fund and firm. Cost allocation, expense caps and rebates sit exactly on it, and they are where investor complaints and audit findings cluster.

Private markets fee mechanics. Waterfall calculations, carried interest and equalisation are genuinely complex, done by few people, and almost never as simple as the fund documentation makes them sound.

Administrator oversight that is nominal. Where the manager has outsourced production, someone still has to challenge the output. A firm that receives a NAV and publishes it without interrogation has outsourced the work and retained the responsibility.

And data across systems. Portfolio management, administrator platform, CRM and ledger rarely agree on entity or share-class definitions, which makes both K-factor reporting and investor analysis harder than it should be — the same problem our guide to data quality in the finance function describes.

Asset management finance salaries 2026

Three premiums are consistent. Private markets prices above liquid funds at equivalent seniority, because waterfall and carried interest experience is scarcer. Buy-side over administrator — moving from a fund administrator to a manager typically carries an uplift, which is why that is the most common career step in the sector. And multi-jurisdiction structures add further. Wider benchmarks are in our regulated-firm finance salary guide and the salary guides. Note that remuneration for material risk takers falls within the FCA’s remuneration requirements, including deferral.

Specifying the role

Four things decide whether the shortlist is relevant.

Fund side, firm side, or both? The first and most important. Say it plainly, and if both, say roughly in what proportion.

Production or oversight? Whether you produce NAVs in-house or review an administrator’s. Candidates from one do not automatically fit the other, and someone whose whole career has been production frequently finds oversight unsatisfying.

Fund structures and asset class. Open-ended or closed-ended, UCITS, AIF, LP; liquid or private markets. Private markets and daily-dealt funds are different disciplines and the pools barely overlap.

And whether the firm holds client money. It changes the role materially and narrows the pool.

Qualification — ICAEW, ACCA or CIMA — is the baseline; sector and structure experience is what you are buying. Our asset management FC practice covers the search.